Largest 12 day range since May 2010
The GBPUSD has moved from a high of 1.5551 to a low of 1.46988 in 12 trading days. The high price found resistance sellers against the 100 day MA on February 26th (see blue line on the daily chart below). The low price today traded within 12 pips of the June 22nd 2010 low of 1.4686.
The catalyst for the move was an overall stronger dollar, helped by a better US employment report. Recent comments from BOE Governor Carney has also pressured the pair.
I would not be true to myself, if I also did not also mention that more bearish technicals have contributed to the decline - starting with the inability to move above the 100 day MA and the fall below the all important 1.5000 level and lows going back to 2014 (see daily chart below).
Looking at the hourly chart below, the pair also accelerated the decline below the bottom channel trend line in trading today. Sellers are still king.
The 850 pip range sounded like a lot of pips in a relatively short amount of time. So I did a little Excel work and figured out the 12-day high to low range is the largest range since May 21, 2010. Needless to say, this type of trend move does not happen often.
Of course the trends are fast, directional and tend to go farther than anyone ever expects. So for me, I will need to see the price show some signs that the buyers are taking control in next week's trading before calling that the bottom is in place.
That clue might come from a move back into the channel on the hourly chart.
It might also require a move back above the 1.4811 and 1.4830 lows from March and July 2014 lows. Those might be the first steps toward a recovery, but they are needed to show the trend down is potentially over.
The chart below shows the May 2010 period when the GBPUSD was in a free fall. The move from top to bottom moved 1268 pips. The high started at 1.5497, not too far from the high of 1.5551 from Feb 26, 2015.
